based on the materials from the site - By COINTURK NEWS
The U.S. national debt has soared to unprecedented levels. According to data from the U.S. Department of the Treasury, the country's debt level increased by $384.7 billion in just one week. This significant rise followed the approval of a large spending package in the first week of July. As a result, the total national debt reached a historic maximum of $36.6 trillion.
New budget law and debt ceiling
A recently passed spending law by Congress raised the debt ceiling by $5 trillion. This adjustment set the debt ceiling at $41.1 trillion, marking the largest one-time increase in U.S. history. The new debt ceiling is intended to prevent the country from defaulting at least until 2027.
Comprehensive legislation also extends tax breaks introduced in 2017 indefinitely. Making these tax breaks permanent could lead to a reduction in federal revenues by trillions of dollars over the next decade. Some experts believe this could lead to a significant budget deficit in the American financial system.
Sources of debt growth and economic consequences
Experts argue that the main reason for the recent sharp increase in debt is the replenishment of the General Fund of the Treasury. The government is again borrowing funds to cover overdue payments and strengthen cash reserves. At the same time, additional funding needs are mostly covered by national debt.
The Congressional Budget Office (CBO) projects that the new budget law will result in an additional deficit of $2.8 trillion over the next decade. It is assumed that the negative impact of some legislative changes on revenues may not be fully offset by spending constraints.
However, there are differing views within the government. The Trump administration believes this law will have a positive impact on the economy in the long term. It is claimed that tax cuts and certain regulatory measures will accelerate economic growth.
U.S. Treasury Secretary Scott Bessent: "I believe that the tax cuts and regulations provided by this law will contribute to economic growth that will more than compensate for concerns about the budget deficit."
Economists warn that the rapid growth of borrowing levels could lead to increased interest expenses, which will burden the budget in the future. The reduction in federal revenues and the growth of interest payments are being closely monitored for their sustainability.
This rapid growth of the U.S. national debt is seen as a factor that could directly affect the country's financial balance and future expenditures. The impact of borrowing policies on medium- and long-term economic growth is under close scrutiny by financial circles and the public. Government officials argue that regulation will stimulate economic growth and reduce the burden on the budget.
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